Online Travel Agent

An Online Travel Agent (OTA) is a third-party platform that allows travelers to research, compare and book travel. This can include rental cars and airfare, but these platforms have grown to play a critical role in hotel distribution.

The term OTA hotel is also used often—it refers to a hotel that distributes its inventory through one or more of these agencies to increase visibility and drive reservations. Hoteliers pay a commission fee for each confirmed booking, and in return, receive broader audience exposure and the chance to sell last-minute room inventory.

How Do OTAs Work in Hospitality?

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Online travel agents act as digital intermediaries between hotels and potential guests. Here’s how the process typically works:

• Hotels list rooms, rates and availability on the OTA platform.
• Guests browse, filter and compare options based on their search preferences.
• Once a booking is made, the OTA takes a commission (usually between 10% and 25%) and confirms the reservation with the hotel.

Most OTAs offer powerful search functionality, guest reviews, loyalty programs and dynamic pricing tools, making them influential in shaping consumer decisions.

Pros and Cons of OTAs in Hospitality

Benefits of OTAs for Hotels

Using online travel agencies can help hotels reach guests that may not discover them otherwise, which is especially beneficial for independent and boutique properties. Key benefits include:

• Increased visibility: OTAs attract millions of visitors, helping hotels reach guests they may not capture through direct channels.
• Faster occupancy growth: Especially valuable during low seasons or soft openings.
• Trust and social proof: Verified guest reviews boost credibility and drive bookings.
• Mobile and global reach: Many OTAs are optimized for mobile and translated into multiple languages, supporting international bookings.

Challenges of Relying on OTAs

While OTAs are powerful tools, they come with trade-offs that hoteliers should consider. Here are some reasons why many hotels aim to balance OTA bookings with a robust direct booking strategy:

• High commission fees eat into profit margins.
• Limited guest data ownership makes it harder for hotels to build direct relationships.
• Rate parity agreements can restrict pricing flexibility across channels.
• Brand dilution can occur if guests associate the booking experience with the OTA instead of the hotel.

How Canary Helps Hotels Reduce OTA Dependence

While OTAs offer reach, direct bookings offer control—and Canary can help you bridge the gap to make the most of both. Canary’s guest journey solutions let hoteliers capture data, encourage repeat bookings and build a direct relationship with guests. Book a demo today to learn more.